GameStop (GME) stock is ripping higher again.
Shares in the video game retailer rose more than 20% on Wednesday, and is now up more than 35% in the last five days.
The move comes as reports have swirled that an increasing number of bets have been placed on a call option for GameStop stock to hit $20 per share by Dec. 8.
GameStop is the latest speculative trade to enter the November 2023 stock market rally as beaten-down areas of the market like cryptocurrency-related stocks and other meme names see a rebound.
The move to a more risk-on trade in markets comes as investors have interpreted a string of economic data showing cooling pricing pressures combined with a slowdown in the labor market to mean the Federal Reserve is done raising interest rates.
"'Meme stocks' tend to be unprofitable so they especially benefit from lower rates since they have an even greater need to raise capital at reasonable prices," explained DataTrek co-founder Jessica Rabe in a note on Nov. 20.
Rabe added: "Meme stocks' current positive momentum shows investors' animal spirits are starting to run hot again."
GameStop's stock has tanked over the last six months, down nearly 50% as the company went through management changes and questions about the overall outlook for the brick-and-mortar video game retailer swirled.
At the end of September, Ryan Cohen, the founder of Chewy (CHWY) and a notable name in the meme stock craze, was named CEO of GameStop.
The company is scheduled to report quarterly earnings next Wednesday.
Josh Schafer is a reporter for Yahoo Finance.
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